The Judicial Committee of the Privy Council (JCPC) has today handed down its judgment in the case of Ting Chuan (Cayman Islands) Holding Corp v FamilyMart China Holding Co Ltd (JCPC 2020/0055) on September 20, 2023. The JCPC ruled in favor of the Appellant, whose legal team included Sidley Austin. The judgment represents one of the most legally significant developments in the areas of arbitration and insolvency in recent years and will have wide-ranging impact throughout the common law world.
The Appellant and Respondent were shareholders in a joint venture incorporated in the Cayman Islands. The relationship between the shareholders was governed by a shareholders agreement containing an arbitration clause. The issue arose when the Respondent filed a petition in the Cayman Islands to wind up the joint venture on just and equitable grounds. The question on appeal before the JCPC was: Is any part of a petition to wind up a company on just and equitable grounds susceptible to arbitration?
The JCPC answered this question in the affirmative, ruling in favor of the Appellant, overturning the decision of the Cayman Islands Court of Appeal below and ordering a stay of the winding-up proceedings in favor of arbitration. The JCPC considered that certain matters that underpinned the basis for the Respondent’s winding-up petition must be first determined by arbitration in accordance with the parties’ agreement. A detailed analysis of the judgment will follow.
The Sidley Team, based in Hong Kong, was led by Desmond Ang (Partner), with support from Sophia Tong (Senior Managing Associate) and Christoph Murphy (Managing Associate).